At some point in the lifecycle of any small business, you’ll have to fire a customer. While it seems completely counterproductive to positive cash flow and business growth, there are times when ending a customer relationship is necessary.
In this post on OpenForum.com, James O’ Brien, author of The Indie Writer’s Survival Guide, explains when it’s appropriate to terminate a customer relationship for the best interest of your business.
“Owning a small business doesn’t mean continually trying to serve someone who’s shown they can’t be pleased. And that old business slogan — the customer is always right — well, that’s only accurate some of the time.”
Three Situations When It's Time to Fire a Customer
Abusive Behavior
Customer service representatives have to deal with some particularly unsavory customers, so empower your personnel to end abusive, vitriol-filled conversations quickly. It’s unreasonable to subject your service team to customers who, despite all attempts to resolve an issue, continue to use abusive language or threaten.
“Set out the rules of interaction with the problematic customer one last time, and make it clear that the next incident will result in you terminating transactions once and for all.”
Stranded Without Tools
Professional service companies feel the brunt of clients who place demands and expectations on them without providing the necessary resources to complete the project satisfactorily.
“For instance, you can’t make someone’s website copy sing if you can’t get access to the information the customer wants you include, and you can’t start pouring concrete until your client signs off on the blueprints.”
At some point, service providers can continue working with complaint-prone customers, but it’s another matter entirely to work with customers who delay completion of a project because they don’t deliver necessary materials on schedule.
Excessive Workflow Disruption
Too many calls per day, constant changes to project timelines, and a lack of respect for other client needs are all signs of a customer unable or unwilling to respect boundaries.
Sudden schedule changes are particularly disruptive to busy workloads. If a client refuses to recognize their actions negatively impact timely and satisfactory delivery of their project, business owners need to take action and place that client in the care of another service provider.
“In the end, you’ll fire less and invoice more.”
While firing a customer is never a pleasant experience, it can be an opportunity to improve your internal processes on customer service, and taking on new work.
“Ask better questions about workflow and deliverables, and where you’ll get the data and materials necessary to complete the work.”
